What inputs does the Freelance Tax Estimator need?

It takes 5 inputs: annualGrossIncome, businessExpenses, selfEmploymentTaxPercent (default 15.3), estimatedIncomeTaxPercent (default 22), deductions (default 0). Outputs returned: taxableIncome, selfEmploymentTax, estimatedIncomeTax, totalAnnualTax, quarterlyPayment, effectiveTaxRate, takeHomePay.

Can I verify the Freelance Tax Estimator with a worked example?

Yes. With annualGrossIncome = $120,000, businessExpenses = $15,000, selfEmploymentTaxPercent = 15.3%, estimatedIncomeTaxPercent = 22%, deductions = $0. the tool returns taxableIncome = $105,000, net_se = $96,967.50, selfEmploymentTax ≈ $14,836.03 (OASDI $12,023.97 + Medicare $2,812.06), estimatedIncomeTax = $23,100, totalAnnualTax ≈ $37,936.03, quarterlyPayment ≈ $9,484.01.

Where does the Freelance Tax Estimator get its benchmark data?

Reference data is sourced from: US IRS — Self-Employment Tax (Pub. 334, Pub. 505, Schedule SE) (as of 2026); US SSA — 2026 Social Security wage base ($184,500) (as of 2026).

What can the Freelance Tax Estimator not tell me?

Known limitations: Federal estimates only; state and local income tax and franchise taxes are not modeled. Income tax is a flat-rate estimate, not a bracket calculation — it will diverge from a progressive schedule, especially across bracket boundaries. Does not model the QBI deduction, SEP-IRA / solo 401(k) contributions, HSA deductions, the deduction for half of SE tax, or credits. Safe-harbour rules (110% of prior year's tax for higher earners) are not implemented — consult Pub. 505.

Methodology: Freelance Tax Estimator

1. Scope

Estimates US federal quarterly tax set-aside from freelance income, deductible expenses, and additional deductions. Self-employment tax follows the IRS Schedule SE mechanics; income tax is a flat-rate estimate you supply, not a bracket calculation. Federal-only. Not tax advice. For jurisdiction-specific planning, consult a licensed tax professional.

2. Inputs and outputs

Inputs

annualGrossIncome number (currency/year)
businessExpenses number (currency/year)
selfEmploymentTaxPercent percent default: 15.3

US statutory combined SE rate (12.4% Social Security + 2.9% Medicare).
estimatedIncomeTaxPercent percent default: 22

Flat income-tax-rate estimate — your marginal or effective bracket. No filing status is modeled.
deductions number (currency/year) default: 0

Retirement contributions, health insurance, home office, etc.

Outputs

taxableIncome

gross − expenses − deductions.
selfEmploymentTax

SE tax on 92.35% of net earnings: OASDI portion capped at the SSA wage base, Medicare portion uncapped.
estimatedIncomeTax

taxableIncome × your flat income-tax rate.
totalAnnualTax

selfEmploymentTax + estimatedIncomeTax.
quarterlyPayment

totalAnnualTax / 4.
effectiveTaxRate

totalAnnualTax / gross income.
takeHomePay

gross − expenses − totalAnnualTax.

Engine source: src/lib/freelance-tax-estimator/engine.ts

3. Formula / scoring logic

taxable_income = gross - expenses - deductions
net_se         = taxable_income * 0.9235
se_tax         = min(net_se, 184500) * 0.124  +  net_se * 0.029   (at the 15.3% default; the entered SE rate scales both portions in the 12.4 : 2.9 statutory proportion)
income_tax     = taxable_income * income_tax_rate   (flat estimate, no brackets or filing status)
total          = se_tax + income_tax
quarterly      = total / 4

4. Assumptions

Income tax is a single flat rate you enter — the tool does not compute brackets, filing status, or the standard deduction.
Self-employment tax is computed on 92.35% of net SE income; the 12.4% Social Security (OASDI) portion caps at the 2026 SSA wage base ($184,500), the 2.9% Medicare portion is uncapped.
Federal-only: no state or local income tax, no QBI deduction, and no deduction for one-half of SE tax.

5. Data sources

US IRS — Self-Employment Tax (Pub. 334, Pub. 505, Schedule SE) as of 2026
US SSA — 2026 Social Security wage base ($184,500) as of 2026

6. Known limitations

Federal estimates only; state and local income tax and franchise taxes are not modeled.
Income tax is a flat-rate estimate, not a bracket calculation — it will diverge from a progressive schedule, especially across bracket boundaries.
Does not model the QBI deduction, SEP-IRA / solo 401(k) contributions, HSA deductions, the deduction for half of SE tax, or credits.
Safe-harbour rules (110% of prior year's tax for higher earners) are not implemented — consult Pub. 505.

7. Reproducibility

Input
annualGrossIncome = $120,000, businessExpenses = $15,000, selfEmploymentTaxPercent = 15.3%, estimatedIncomeTaxPercent = 22%, deductions = $0.

Expected output
taxableIncome = $105,000, net_se = $96,967.50, selfEmploymentTax ≈ $14,836.03 (OASDI $12,023.97 + Medicare $2,812.06), estimatedIncomeTax = $23,100, totalAnnualTax ≈ $37,936.03, quarterlyPayment ≈ $9,484.01.

8. Change log

2026-04-24 methodology page first published.
2026-07-05 SE tax now applies the 92.35% net-earnings factor and caps the OASDI portion at the 2026 SSA wage base ($184,500); income tax documented as a flat-rate estimate (no brackets/filing status), matching the shipped engine.

Worked example

Run live against the same engine this site ships (/engines/freelance-tax-estimator.js). The inputs and outputs below are recomputed on every build and independently re-verified in CI — they are never hand-authored.

Input

tool: freelance_tax_estimator
annual_gross_income: 120000
business_expenses: 15000
self_employment_tax_percent: 15.3
estimated_income_tax_percent: 22
deductions: 0

Output

taxableIncome: 105000
selfEmploymentTax: 14836.03
estimatedIncomeTax: 23100
totalAnnualTax: 37936.03
quarterlyPayment: 9484.01
effectiveTaxRate: 31.61
takeHomePay: 67063.97
disclaimer: Estimate only. Not tax advice. Consult a qualified accountant.

Frequently asked questions

What does the Freelance Tax Estimator calculate?: Estimates US federal quarterly tax set-aside from freelance income, deductible expenses, and additional deductions. Self-employment tax follows the IRS Schedule SE mechanics; income tax is a flat-rate estimate you supply, not a bracket calculation. Federal-only. Not tax advice. For jurisdiction-specific planning, consult a licensed tax professional.
What inputs does the Freelance Tax Estimator need?: It takes 5 inputs: annualGrossIncome, businessExpenses, selfEmploymentTaxPercent (default 15.3), estimatedIncomeTaxPercent (default 22), deductions (default 0). Outputs returned: taxableIncome, selfEmploymentTax, estimatedIncomeTax, totalAnnualTax, quarterlyPayment, effectiveTaxRate, takeHomePay.
What formula does the Freelance Tax Estimator use?: The exact computation is: taxable_income = gross - expenses - deductions; net_se = taxable_income * 0.9235; se_tax = min(net_se, 184500) * 0.124 + net_se * 0.029 (at the 15.3% default; the entered SE rate scales both portions in the 12.4 : 2.9 statutory proportion); income_tax = taxable_income * income_tax_rate (flat estimate, no brackets or filing status); total = se_tax + income_tax; quarterly = total / 4
Can I verify the Freelance Tax Estimator with a worked example?: Yes. With annualGrossIncome = $120,000, businessExpenses = $15,000, selfEmploymentTaxPercent = 15.3%, estimatedIncomeTaxPercent = 22%, deductions = $0. the tool returns taxableIncome = $105,000, net_se = $96,967.50, selfEmploymentTax ≈ $14,836.03 (OASDI $12,023.97 + Medicare $2,812.06), estimatedIncomeTax = $23,100, totalAnnualTax ≈ $37,936.03, quarterlyPayment ≈ $9,484.01.
Where does the Freelance Tax Estimator get its benchmark data?: Reference data is sourced from: US IRS — Self-Employment Tax (Pub. 334, Pub. 505, Schedule SE) (as of 2026); US SSA — 2026 Social Security wage base ($184,500) (as of 2026).
What can the Freelance Tax Estimator not tell me?: Known limitations: Federal estimates only; state and local income tax and franchise taxes are not modeled. Income tax is a flat-rate estimate, not a bracket calculation — it will diverge from a progressive schedule, especially across bracket boundaries. Does not model the QBI deduction, SEP-IRA / solo 401(k) contributions, HSA deductions, the deduction for half of SE tax, or credits. Safe-harbour rules (110% of prior year's tax for higher earners) are not implemented — consult Pub. 505.